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The chancellor has drawn up plans to restrict the use of levy funding for degree-level apprenticeships, prompting warnings about the viability of schemes for public sector workers like teachers.

Multiple sources said Jeremy Hunt was concerned about the affordability of the levy. It comes amid a huge rise in the number of costly level 6 and 7 apprenticeships handed to older employees while spending on lower levels and young people falls.

Officials have now floated the idea of limiting the use of levy cash on higher apprenticeships, but the Department for Education is understood to be resisting ahead of next week’s autumn statement.

Proposals include removing some apprenticeships – like the popular but controversial level 7 senior leader standard – from the scope of levy funding, introducing age restrictions, and demanding larger employer contributions.

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